WLL, OAS, PDCE, and CXO: Who Had the Lowest Capex in 2015?


Mar. 24 2016, Updated 9:07 a.m. ET

Capex changes in 2015

In this part, we’ll talk about the capex (capital expenditure) changes in the four upstream companies under review in this series: Whiting Petroleum (WLL), Oasis Petroleum (OAS), PDC Energy (PDCE), and Concho Resources (CXO).

Oasis Petroleum recorded the highest capex fall of ~39% in 2015 compared to 2014. OAS spent $819.8 million in capex compared to ~$1.3 billion in 2014. WLL recorded a capex fall of ~16% in 2015 versus 2014. In 2015, WLL spent $2.3 billion in capex compared to ~$3 billion in 2014.

PDCE and CXO recorded capex falls of just ~4% and 4.3%, respectively, in 2015 compared to 2014. PDCE spent $604 million in capex in 2015 compared to ~$628 million in 2014. CXO spent $2.4 billion in capex in 2015 compared to ~$2.6 billion in 2014.

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Capex guidances for 2016

OAS’s 2016 capex budget is 34% lower than its 2015 capex, while WLL’s 2016 capex budget is 80% lower than its 2015 capex of $4 billion. CXO’s 2016 capital program is 35% lower than its 2015 capex. PDCE’s capex in 2016 is estimated to be just 23% lower than its 2015 capex.

The capex cuts come amid low oil prices and reduced drilling activities as companies strive to protect cash flows. Other upstream companies that have been reducing their 2016 capex in response to lower energy prices include ConocoPhillips (COP) and Anadarko Petroleum (APC). COP and APC lowered their 2016 capex by 37% and 50%, respectively, compared to 2015.

Marathon Oil’s (MRO) 2016 capex is expected to be less than half of its 2015 capex. All these companies make up ~4.7% of the iShares Global Energy ETF (IXC).


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